Budget committee advances $15.3 million amendment to SFMTA towing contract

The Budget and Finance Committee on Feb. 12 voted to forward a resolution to the full Board of Supervisors recommending approval of a ninth amendment to the Municipal Transportation Agency's towing contract that would add $15,300,000 in spending authority to cover the balance of the contract term through March 31, 2026.

The amendment would increase the contract ceiling for towing, storage and disposal services with Texco LLC (previously Auto Return). SFMTA staff said the additional authority is needed to finish the final year of the existing contract while the agency prepares a competitive reprocurement.

SFMTA manager Lorraine Fuqua told the committee the current contract limits contractor increases to CPI, the contractor has met service targets and about 40% of subcontracting is with local business enterprises. "The towing program is absolutely vital to maintain transit reliability and traffic safety, to remove vehicles from blocked driveways, and to remove vehicles involved in crimes, accidents, and abandoned vehicles," Fuqua said.

Nick Menard of the Budget and Legislative Analyst's office said the contractor is meeting objectives and that the towing program will not be fully cost-recovered in the final year; the analyst's office projects an $8 million shortfall for MTA in that period. Menard told supervisors the panel could consider policy options to reduce that gap, including reducing discounts, raising fees for those who do not qualify for discounts, or increasing enforcement.

Supervisors discussed the program's waiver policies for low-income and unhoused residents. Fuqua said first-time-tow and low-income waivers reduce fees substantially and that waivers for stolen vehicles are also applied. Trustee-level public testimony from Mark Gleason of Teamsters Local 665 expressed union support for passage.

On a motion to forward the measure with a positive recommendation, the committee recorded aye votes and the item was forwarded to the full board for final action.

The committee heard SFMTA intends to release a reprocurement by April 2025 and allow for a transition period if a new vendor is selected. The department estimates the procurement and evaluation period will take roughly six months.

If approved by the full board, SFMTA will use the increased authority to operate through the current contract term while it completes the RFP and transition planning.

Votes at committee: motion to forward to full board with positive recommendation; recorded ayes and the item was advanced to the full board.